company roadmap margaret wallace
DESCRIPTION
business plan adviceTRANSCRIPT
Your Company Roadmap
Bootstrapped vs. VC-Funded Companies
Margaret Wallace, CEO, Playmatics
1996
Copyright 2010. Margaret Wallace. Please Attribute Proper Credit if You Use These Slides
$
Copyright 2010. Margaret Wallace. Please Attribute Proper Credit if You Use These Slides
Social
Single-Player
CasualHard-Core
Different ConsiderationsLessons LearnedSharpened Focus
Takeaway: Experience is the Best Education.
Basic ParametersBoot-Strapped VC-FundedLow Burn-Rate – < $100k/month
Source of Revenue
Return of Up to 10X on Any Investment
Juggle Many Things
Time to Experiment
Higher Burn-Rate – $100k +++
No Immediate Source of Revenue if Early Stage
10X or Greater ROI ($50M + in revenue)
Highly Focused
Greatly Accelerated
Takeaway: The Roadmap for a VC-Funded Company Will Generally Be More Accelerated.
80%
15%
5%
How VCs Rate Your Chance of Success
#FAIL
Break-Even
Break-Out Success
Takeaway: VCs & Companies Goals Are Not Always in Alignment.
Strength of IdeaMarket Size
Strength of TeamCompetition
Takeaway: VCs are all about managing risk. The more risk you remove, the more comfort they have with you.
Market Size & CompetitionBoot-Strapped VC-FundedGo After Whatever Market or Audience You Want
Can Fill Whatever Role in the Market You Want (For Better or Worse)
Can Execute No Matter the Vision
Must Prove Significant Market Size
Need to Show You Fill a Unique Niche
Must Show You Have Some Competitive Edge
Takeaway: VCs Will Want To See You’ve Thought Through Strengths, Weaknesses, Opportunities, Threats (SWOT).
Tech & Cost Risk RemovedCost Amortized Across Multiple Games
• More Engagement for the Money • Comparable to Costs for One-Off Standalone Web
Game That’s Less Engaging• Up Front & Ongoing Cost Savings.
, One-Off $-
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$50,000
$500,000
, One-Off0
50
100
150
200
250
300
350
70 Days
300 Days
Cost For a Game on Monkey Wrench vs. One-Off Development
Time For a Game on Monkey Wrench vs. One-Off Development
Sample Slide: Market Advantage
Team StructureBoot-Strapped VC-FundedMore Flexible, can be more ad hoc
Founders Generally Remain Managers
Option to Grow Organically
Option to Grow Slowly Over Time
More Structured
Key Exec Roles Held By Non-Founders
Pressure to “stack” org chart with “resumes” to appear attractive to investors
Expectation to Grow Quickly
Takeaway: Structure your staffing plan to reflect your investment approach.
FinancingBoot-Strapped VC-FundedIncoming Revenues Not Fixed But Have Huge Potential
Pressure to Save Money
More Flexibility in Spending
Have Some Type of Runway – recommend 18 months
Pressure to Spend Money
VCs Want to See a Plan for Spending the Amount of Money Being Raised
Takeaway: Raise Enough Investment to Give Yourself 18 to 24 Months of Runway.
Roll-Out & ProjectionsBoot-Strapped VC-FundedRisk in Taking Too Long to Roll-Out
Projections Can Be More Conservative
Can Stay Focused
No Specific Exit Required (Throw Out Your Business Plan and Get to Work!)
Risk in Not Having Enough Time to Roll-Out
Projections Must Show Growth Potential of $50M -- $100M
May Face Pressure to “Gold Plate” Offering
What Exit Opportunities Are There?
Takeaway: VCs Will Want to See You Profitable or Break-Even Within 18-24 Months.
User Growth: Registrations & Total Games
Feb Mar Apr May June0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
3,529
58,393105,348
155,793
300,000
8,823
145,983
263,370
389,483
750,000
User RegistrationsTotal Games
Sample Slide: Projections
“To the VC, 3x and a dead startup are essentially the same given the way they calculate their batting averages. At this point you have a problem.”
• Hillel Cooperman, Jackson Fish Market, Web startup in Seattle.
Resources
• TheFunded – www.thefunded.co• VentureBeat – www.venturebeat.com• Blog, Musings of a VC in NYC --
http://www.avc.com/
